The federal minimum wage provisions are contained in the Fair Labor Standards Act (FLSA). The current federal minimum wage for covered non-exempt employees is $7.25 per hour. Many states also have minimum wage laws. In cases where an employee is subject to both the state and federal minimum wage laws, the employee is entitled to the higher of the two minimum wages.
Colorado’s minimum wage for 2023 is $13.65, and the tipped employee minimum wage in the state is $10.63. The law states that no more than $3.02 per hour in tip income may be used to offset the minimum wage of tipped employees.
According to the Colorado Department of Labor and Employment (CDLE), employers must meet certain pay levels, such as minimum wage. To assist employers in determining pay levels, the CDLE provides a yearly PAY CALC order that lists the required pay levels, such as the state’s general minimum wage rate, the salary threshold for certain exempt employees, and the minimum wage rate for agricultural workers.
On May 28, 2019, Colorado’s Governor Jared Polis signed into law House Bill 1210 that allows cities and counties in Colorado to set their own minimum wages in 2020, with increases being effective January 1, 2021. Before HB 1210, state law blocked local governments from enacting their minimum wage laws. As of 2023, Denver is the only city or county to enact a higher minimum wage than the state.
Denver’s Minimum Wage law was effective January 1, 2020, and applies to all workers performing work within the geographical boundaries of the City and County of Denver. The minimum wage determination is based on where the work is performed, not based on where the business’s offices are located. The 2023 Denver Minimum Wage is $17.29. The 2024 Denver Minimum Wage is expected to be $17.29 plus the Consumer Price Index, which will be effective January 1, 2024.
Denver’s local minimum wage does not apply to:
- Work performed outside of Denver;
- Where an employee works less than 4 hours within Denver in a week; and
- Where the employee is only traveling through Denver while working.
- Exceptions also include certified youth employment programs and independent contractors.
For example, if the employer’s office is in Denver and an employee works remotely outside of Denver, the Denver minimum wage does not apply. However, suppose the employee works in Denver for any reason (i.e., meeting with a client, working out of the Denver office, or even attending a staff meeting in the Denver office). In that case, the Denver minimum wage applies and must be tracked and paid on a per-pay basis.
The law applies to all workers, regardless of Fair Labor Standards Act (FLSA) designation, job title, or job duties, and includes sales staff. Base salary and commissions apply towards minimum wage calculations per pay period. However, bonuses do not apply when calculating the Denver minimum wage. Employers are required to post the Denver Minimum Wage/Wage Theft poster in a conspicuous place for all employees. (denver-labor/2023/wage_theft_poster_2023-digital.pdf).
Boulder is considering increasing the minimum wage to $15.41 an hour in 2024, with annual increases reaching $25 an hour by 2028.
Based on a study conducted by SmartAsset, Denver’s minimum wage ranks second highest among the 79 cities. The study also showed that “Denver’s ordinance requires Denver’s minimum wage to increase each year based on the Consumer Price Index, which tracks the price of goods and services in the economy. After factoring in the cost of living, which is 14.7% higher than the national average, Denver has the highest adjusted minimum wage in our study: $15.07.” The study lists the top 15 cities with the highest minimum wage as follows:
- Seattle, WA $18.69
- Denver CO $17.29
- Spokane, WA $15.74
- Stockton, CA $15.50
- Sacramento CA $15.50
- Minneapolis, MN $15.19
- Buffalo, NY $14.20
- Phoenix, AZ $13.85
- Tucson, AZ $13.85
- St. Paul MN $13.50
- Baltimore, MD $13.25
- Albuquerque, NM $12.00
- St. Louis MO $12.00
- Kansas City MO $12.00
- Richmond, VA $12.00
According to the Economic Policy Institute’s Minimum Wage Tracker for 2023, 30 states and the District of Columbia have a minimum wage higher than the federal minimum wage. These states are Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Jersey, New Mexico, New York, Ohio, Oregon, Rhode Island, South Dakota, Vermont, Virginia, Washington, West Virginia, and Washington D.C.